The Goods and Services Tax Council shall make recommendations to the Union and the States on a number of issues. Special provisions to how many States the Council can make recommendations?

Question

While Section 245C of the Income Tax Act, 1961 provides that the disclosures as to income “not disclosed before the Assessing Officer” must accompany the application filed before the Settlement Commission, Section 245H provides that if the assessee has cooperated with the Settlement Commission and has made “full and true disclosure of his income”, the Settlement Commission may grant immunity from prosecution and penalty. It is the case of the Revenue that Section 245H (1) cannot be read in isolation as Section 245C is embedded in 245H(1), and hence, both the Sections must be read harmoniously. That when so read, the requirement under Section 245H would be that disclosure of income “not disclosed before the Assessing Officer” must be made before the Commission
In this regard, it is observed that even if the pre-conditions prescribed under Section 245C are to be read into Section 245H, it cannot be said that in every case, the material “disclosed” by the assessee before the Commission must be something apart from what was discovered by the Assessing Officer. Section 245C read with Section 245H only contemplates full and true disclosure of income to be made before the Settlement Commission, regardless of the disclosures or discoveries made before/by the Assessing Officer. It is to be noted that the Order passed by Assessing Officer based on any discovery made, is not the final word, for, it is appealable. However, the assessee may accept the liability, in whole or in part, as determined in the assessment order. In such a case, the assessee may approach the Settlement Commission making ‘full and true disclosure’ of his income and the way such income has been derived. Such a disclosure may also include the income discovered by the Assessing Officer.
[Extracted with edits from the decision of the Supreme Court in Kotak Mahindra Bank Ltd. v. Commissioner of Income Tax, Bangalore, 2023 LiveLaw (SC) 822, dated September 25, 2023].

Answer 1

Rather than guessing between the four numbers, it is more reliable to actually list out the special category States that Article 279A(4)(f) covers and count them.

Eleven: The list runs Arunachal Pradesh, Assam, Jammu and Kashmir, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura, Himachal Pradesh, and Uttarakhand. That is the north-eastern States plus J&K, Himachal Pradesh and Uttarakhand, eleven States in total, which is why the GST Council's power under this clause is often described as covering "special category States".
Six, Eight: Both of these undercount the list. Even counting only the north-eastern States gives eight, so six is too low, and eight leaves out Jammu and Kashmir, Himachal Pradesh and Uttarakhand.
Thirteen: This overshoots the actual list, there is no basis in Article 279A(4)(f) for a count that high.

Building the answer up from the actual named States, rather than picking a round number, confirms eleven as the correct count.

Let's summarize:

Article 279A(4)(f) names eleven special category States for GST Council recommendations.
Six, eight and thirteen do not match the actual list once the States are counted out.

The correct answer is Eleven.

Answer 2

Rather than guessing between the four numbers, it is more reliable to actually list out the special category States that Article 279A(4)(f) covers and count them.

Eleven: The list runs Arunachal Pradesh, Assam, Jammu and Kashmir, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura, Himachal Pradesh, and Uttarakhand. That is the north-eastern States plus J&K, Himachal Pradesh and Uttarakhand, eleven States in total, which is why the GST Council's power under this clause is often described as covering "special category States".
Six, Eight: Both of these undercount the list. Even counting only the north-eastern States gives eight, so six is too low, and eight leaves out Jammu and Kashmir, Himachal Pradesh and Uttarakhand.
Thirteen: This overshoots the actual list, there is no basis in Article 279A(4)(f) for a count that high.

Building the answer up from the actual named States, rather than picking a round number, confirms eleven as the correct count.

Let's summarize:

Article 279A(4)(f) names eleven special category States for GST Council recommendations.
Six, eight and thirteen do not match the actual list once the States are counted out.

The correct answer is Eleven.

The Goods and Services Tax Council shall make recommendations to the Union and the States on a number of issues. Special provisions to how many States the Council can make recommendations?

The Correct Option is C

Solution and Explanation

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